Not all electric bikes are the same

Electric bikes are becoming more and more popular in business life. On the one hand they are used by workers for their home-to-work travel and on the other hand an employer can provide them to his personnel. In this infoflash we examine whether the electric bike can be considered as a bike when it comes to fiscal matters.

Different types of electric bikes

There are two types of electric bikes on the market:

• The classic electric bike that meets the following conditions:

1. the bike must be a pedal assist bike, meaning that it provides power only when the rider is pedaling. The electric engine generates extra power but it stops when the rider is not pedaling;
2. pedal assist mode of the engine only works up to a speed of 25 km/h;
3. the power limit of the engine is 250 watt.

Bike according to tax legislation

In order to be considered as a bike under tax legislation, the electric bike must meet the three conditions mentioned above for the classic electric bike. This has an influence on the following benefits.

Bike allowance

The kilometric allocance granted to a worker or company manager for actual home-to-work bike travelling is exempted of income tax for a maximum of 0.22 EUR/km (income year 2016).

When the electric bike does not meet the conditions of the classic electric bike, the allowance granted by the employer for home-to-work travel will be considered as a taxable income. However, a tax exemption of maximum 380 EUR is applied when the worker opts for a deduction of the flat-rate professional expenses when declaring his income tax. Company managers are not entitled to this benefit.

Provision of a bike and accessories

The benefit resulting from the provision of a bike and accessories, including maintenance and storage costs, is exempted from taxes for the worker and the company manager. It is however required that the bike is actively used for home-to-work travel.

The exemption applies for home-to-work travel as well as for other travelling (purely private travelling).

The exemption above only applies when the electric bike meets the conditions of the classic electric bike. The so-called speed pedelecs do not fall under this tax exemption rule.

Consequently, for these speed pedelecs the general rules will apply that are valid when a benefit of all kinds is granted. The worker or company manager will be levied on the actual value of the benefit.

Source: Q&A Lower House 2015-2016, 16 February 2016, no. 54/067, 65 (Question no. 807 J. Van den Bergh).

Author: Peggy Criel

26/07/2016